The Industrial Product Price Index (IPPI)
edged down 0.1% in August compared with July, largely
the result of lower prices for motor vehicles and other
transportation equipment. The Raw Materials Price Index
(RMPI) rose 3.4% in August, mostly
because of higher prices for mineral fuels, specifically
crude oil.
Industrial Product Price Index, monthly change
The IPPIposted a fourth consecutive decline in
August. However, the decrease of the index was smaller than
in the previous three months. Of the 21 major
commodity groups, 13 were down
while 4 were up.
The motor vehicles and other transportation equipment group
(-1.3%) made the largest contribution to the
decline of the IPPI, primarily due to lower
prices for motor vehicles (-1.8%). The
increase in the value of the Canadian dollar against the
USdollar in August was largely responsible for
the decline.
Some Canadian producers who export their products are
generally paid on the basis of prices set in
USdollars. Consequently, the 2.2%
increase in the value the Canadian dollar relative to the
USdollar in August had the effect of reducing
the corresponding prices in Canadian dollars. Without the
impact of the exchange rate, the IPPIwould
have risen 0.4% instead of falling 0.1%.
Downward pressure on the IPPIalso came from
primary metal products (-0.8%), specifically
lower prices for aluminum products (-2.8%),
copper and copper alloy products (-3.0%) and
nickel products (-5.2%).
Conversely, the decline of the IPPIwas
moderated mainly by higher prices in the petroleum and coal
products group (+3.4%), especially fuel oils and other fuel
(+4.4%) and gasoline (+2.5%).
The IPPIexcluding petroleum and coal products
fell 0.5% in August.
Industrial Product Price Index, 12-month change
Compared with August 2011, the IPPIwas
down 0.3%. This was the first year-over-year decrease
of the index since March 2010.
The main contributor to the decline of the
IPPIwas the primary metal products group
(-10.7%), particularily other non-ferrous
metal products (-14.9%), aluminum products
(-15.0%), nickel products
(-28.4%) and copper and copper alloy products
(-12.6%). Silver and platinum were largely
responsible for the decrease in other non-ferrous metal
products.
Among the other major commodity groups that contributed to
the IPPIdecline were chemical products and
pulp and paper products.
Compared with August 2011, the
IPPIdecline was moderated primarily by lumber
and other wood products (+7.0%), specifically as a result
of higher prices for lumber and ties. The motor vehicles
and other transportation equipment group was also up on a
year-over-year basis.
The 0.9% year-over-year decrease in the value of the
Canadian dollar against the USdollar moderated
the IPPIdecline. Without the impact of the
exchange rate, the IPPIwould have
fallen 0.6% instead of 0.3%.
Raw Materials Price Index, monthly change
The RMPIrose 3.4% in August, the second
consecutive monthly increase, posting the largest gain
since November 2011.
Chart 2
Prices for raw materials increase
Chart
description: Prices for raw materials increase
CSV version of the chart
The increase in the RMPIwas largely a result
of higher prices for mineral fuel (+9.1%), specifically
crude oil (+9.8%). The RMPIexcluding mineral
fuels was down 1.3% in August.
Among the other commodity groups, only vegetable products
(+0.1%) rose. The increase was mostly attributable to
grains (+4.3%), specifically corn, wheat and barley.
The advance in the RMPIwas moderated by lower
prices for non-ferrous metals (-3.0%), pushed
downward mainly by copper and nickel concentrates as well
as radioactive concentrates.
Raw Materials Price Index, 12-month change
Compared with August 2011, the
RMPIfell 4.0%, the sixth consecutive
year-over-year decrease. Overall, five of the seven major
commodity groups were down.
The largest contributor to the decline of the index was
non-ferrous metals (-13.6%), particularly
copper and nickel concentrates (-17.2%) and
other non-ferrous base metals (-21.1%).
Lower mineral fuel prices (-2.7%) also
contributed to the year-over-year decrease in the
RMPI. Other commodity groups that posted
declines were ferrous materials, vegetable products, and
animals and animal products.
Compared with August 2011, the
RMPIdecline was slightly moderated by wood
products (+6.5%), specifically due to higher prices for
logs and bolts.
Note to readers
All data in this release are seasonally unadjusted and
usually subject to revision for a period of six months
(for example, when the July index is released, the index
for the previous January becomes final).
The Industrial Product Price Index (IPPI)
reflects the prices that producers in Canada receive as
the goods leave the plant gate. It does not reflect what
the consumer pays. Unlike the Consumer Price Index, the
IPPIexcludes indirect taxes and all the
costs that occur between the time a good leaves the plant
and the time the final user takes possession of it,
including transportation, wholesale and retail costs.
Canadian producers export many goods. They often indicate
their prices in foreign currencies, especially
USdollars, which are then converted into
Canadian dollars. In particular, this is the case for
motor vehicles, pulp, paper and wood products. Therefore,
a rise or fall in the value of the Canadian dollar
against its UScounterpart affects the
IPPI. But the conversion into Canadian
dollars only reflects how respondents provide their
prices. Moreover, this is not a measure that takes into
account the full effect of exchange rates, since that is
a more difficult analytical task.
The conversion of prices received in
USdollars is based on the average monthly
exchange rate (noon spot rate) established by the Bank of
Canada and is available on CANSIMin
table 176-0064 (series v37426). Monthly and
annual variations in the exchange rate, as described in
the release, are calculated according to the indirect
quotation of the exchange rate (for example, CAN$1 =
US$X).
The Raw Materials Price Index (RMPI)
reflects the prices paid by Canadian manufacturers for
key raw materials. Many of those prices are set on the
world market. However, as few prices are denominated in
foreign currencies, their conversion into Canadian
dollars has only a minor effect on the calculation of the
RMPI.
Table 1
Industrial Product Price Index - Not seasonally adjusted
|
|
August 2011
|
July 2012r
|
August 2012p
|
July to August 2012
|
August 2011 to August 2012
|
|
|
%
|
(2002=100)
|
% change
|
|
Industrial Product Price Index (IPPI)
|
100.00
|
114.9
|
114.6
|
114.5
|
-0.1
|
-0.3
|
|
IPPI excluding petroleum and coal products
|
93.70
|
107.0
|
107.1
|
106.6
|
-0.5
|
-0.4
|
|
Aggregation by commodities
|
|
|
|
|
|
|
|
Meat, fish and dairy products
|
6.08
|
109.3
|
110.5
|
110.1
|
-0.4
|
0.7
|
|
Fruit, vegetable, feeds and other food products
|
5.52
|
127.0
|
129.3
|
129.9
|
0.5
|
2.3
|
|
Beverages
|
1.52
|
121.9
|
123.8
|
123.9
|
0.1
|
1.6
|
|
Tobacco and tobacco products
|
0.56
|
172.8
|
181.4
|
181.4
|
0.0
|
5.0
|
|
Rubber, leather and plastic fabricated products
|
3.51
|
119.3
|
122.0
|
121.6
|
-0.3
|
1.9
|
|
Textile products
|
1.37
|
104.1
|
103.8
|
103.8
|
0.0
|
-0.3
|
|
Knitted products and clothing
|
1.33
|
101.8
|
103.2
|
103.2
|
0.0
|
1.4
|
|
Lumber and other wood products
|
6.04
|
88.0
|
93.9
|
94.2
|
0.3
|
7.0
|
|
Furniture and fixtures
|
2.19
|
116.4
|
118.0
|
118.0
|
0.0
|
1.4
|
|
Pulp and paper products
|
6.40
|
100.4
|
100.3
|
99.2
|
-1.1
|
-1.2
|
|
Printing and publishing
|
1.84
|
103.6
|
105.4
|
105.0
|
-0.4
|
1.4
|
|
Primary metal products
|
6.99
|
156.3
|
140.6
|
139.5
|
-0.8
|
-10.7
|
|
Fabricated metal products
|
4.45
|
124.5
|
123.8
|
123.6
|
-0.2
|
-0.7
|
|
Machinery and equipment
|
4.41
|
103.8
|
106.2
|
105.8
|
-0.4
|
1.9
|
|
Motor vehicles and other transport equipment
|
24.34
|
76.7
|
78.5
|
77.5
|
-1.3
|
1.0
|
|
Electrical and communications products
|
5.02
|
92.9
|
93.5
|
93.0
|
-0.5
|
0.1
|
|
Non-metallic mineral products
|
2.07
|
117.9
|
118.5
|
118.3
|
-0.2
|
0.3
|
|
Petroleum and coal products
|
6.30
|
233.2
|
226.7
|
234.5
|
3.4
|
0.6
|
|
Chemicals and chemical products
|
7.19
|
137.2
|
134.8
|
134.5
|
-0.2
|
-2.0
|
|
Miscellaneous manufactured products
|
2.60
|
123.2
|
123.0
|
122.7
|
-0.2
|
-0.4
|
|
Miscellaneous non-manufactured products
|
0.30
|
268.9
|
273.5
|
263.9
|
-3.5
|
-1.9
|
|
62.15
|
123.6
|
122.2
|
122.4
|
0.2
|
-1.0
|
|
7.56
|
146.6
|
135.6
|
134.3
|
-1.0
|
-8.4
|
|
54.60
|
120.4
|
120.4
|
120.7
|
0.2
|
0.2
|
|
37.85
|
100.5
|
102.0
|
101.7
|
-0.3
|
1.2
|
|
Finished foods and feeds
|
7.12
|
118.6
|
119.9
|
119.8
|
-0.1
|
1.0
|
|
Capital equipment
|
12.19
|
86.3
|
88.1
|
87.3
|
-0.9
|
1.2
|
|
All other finished goods
|
18.54
|
102.9
|
104.2
|
104.2
|
0.0
|
1.3
|
1.
The relative importance is based on the
annual 2002 values of production.
2.
Intermediate goods are goods used principally to
produce other goods.
3.
First-stage intermediate goods are items used most
frequently to produce other intermediate goods.
4.
Second-stage intermediate goods are items most
commonly used to produce final goods.
5.
Finished goods are goods most commonly used for
immediate consumption or for capital investment.
Table 2
Raw Materials Price Index - Not seasonally adjusted
|
|
August 2011
|
July 2012r
|
August 2012p
|
July to August 2012
|
August 2011 to August 2012
|
|
|
%
|
(2002=100)
|
% change
|
|
Raw Materials Price Index (RMPI)
|
100.00
|
170.3
|
158.2
|
163.5
|
3.4
|
-4.0
|
|
RMPI excluding mineral fuels
|
58.56
|
156.0
|
150.0
|
148.0
|
-1.3
|
-5.1
|
|
Mineral fuels
|
41.44
|
190.7
|
170.1
|
185.6
|
9.1
|
-2.7
|
|
Vegetable products
|
9.89
|
156.9
|
153.9
|
154.0
|
0.1
|
-1.8
|
|
Animal and animal products
|
19.81
|
125.4
|
125.1
|
124.1
|
-0.8
|
-1.0
|
|
Wood
|
11.82
|
89.7
|
95.7
|
95.5
|
-0.2
|
6.5
|
|
Ferrous materials
|
2.88
|
165.0
|
144.6
|
140.0
|
-3.2
|
-15.2
|
|
Non-ferrous metals
|
11.32
|
273.8
|
243.9
|
236.7
|
-3.0
|
-13.6
|
|
Non-metallic minerals
|
2.82
|
162.4
|
167.0
|
167.0
|
0.0
|
2.8
|
1.
The relative importance is based on the annual 2002
values of intermediate inputs.
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